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Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
In the Matter of )
)
Telephone Number Portability ) CC Docket No. 95-116
) RM 8535
)
SECOND MEMORANDUM OPINION AND
ORDER ON RECONSIDERATION
Adopted: October 15, 1998 Released: October 20, 1998
By the Commission:
TABLE OF CONTENTS Paragraph
I. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . 1
II. BACKGROUND. . . . . . . . . . . . . . . . . . . . . . . 3
III. RECONSIDERATION ISSUES. . . . . . . . . . . . . . . . . 6
A. Database Issues. . . . . . . . . . . . . . . . . . . 6
B. Location Portability . . . . . . . . . . . . . . . . 28
C. 500 and 900 Number Portability . . . . . . . . . . . 31
D. Wireless Issues. . . . . . . . . . . . . . . . . . . 44
IV. ORDERING CLAUSES . . . . . . . . . . . . . . . . . . . . 66
APPENDIX A LIST OF PARTIES
APPENDIX B FINAL RULES
APPENDIX C REGULATORY FLEXIBILITY ANALYSIS
I. INTRODUCTION
1. On June 27, 1996, the Commission adopted the First Report and Order and
Further Notice of Proposed Rulemaking (First Report and Order) in this docket, which
implemented the provisions of section 251 of the Communications Act of 1934, as amended, that
relate to telephone number portability. Specifically, section 251(b)(2) requires that all local
exchange carriers (LECs) provide, "to the extent technically feasible, number portability in
accordance with requirements prescribed by the Commission." Section 251(e)(2) provides that
"the costs of establishing . . . number portability shall be borne by all telecommunications carriers
on a competitively neutral basis as determined by the Commission." The Act defines "number
portability" as "the ability of users of telecommunications services to retain, at the same location,
existing telecommunications numbers without impairment of quality, reliability, or convenience
when switching from one telecommunications carrier to another." In the First Report and Order,
the Commission determined, among other things, that the Commission has authority under section
251 to promulgate rules regarding long-term and currently available number portability, as well as
to establish cost recovery methods for each.
2. Twenty-two parties filed petitions for reconsideration or clarification of the First
Report and Order; 19 parties filed oppositions or comments on the petitions; and 16 parties filed
reply comments. On March 6, 1997, the Commission adopted a First Memorandum Opinion
and Order on Reconsideration in this proceeding, addressing a number of issues. In this Second
Memorandum Opinion and Order on Reconsideration, we address all remaining issues raised by
the petitioners, except issues relating to cost recovery for currently available number portability,
which will be addressed in a future order. We also address American Mobile
Telecommunications' (AMTA) petition for reconsideration of the First Order on Reconsideration,
which raises similar issues to those raised by AMTA in its petition for reconsideration of the First
Report and Order.
II. BACKGROUND
3. In the First Report and Order, the Commission required all LECs to begin
implementing a long-term service provider portability solution that meets the Commission's
performance criteria in the 100 largest Metropolitan Statistical Areas (MSAs) no later than
October 1, 1997, and to complete deployment in those MSAs by December 31, 1998, in
accordance with a phased implementation schedule. In the First Order on Reconsideration, the
Commission modified this schedule, extending the completion dates for the first two phases of the
implementation schedule and clarifying that, within the 100 largest MSAs, LECs need only
provide number portability in switches for which another carrier has made a specific request for
the provision of portability.
4. In the First Report and Order, the Commission also required all cellular,
broadband personal communications services (PCS) and covered specialized mobile radio (SMR)
providers to have the capability of delivering calls from their networks to ported numbers
anywhere in the country by December 31, 1998, and to offer service provider portability,
including the ability to support roaming, throughout their networks by June 30, 1999. In the
First Order on Reconsideration, the Commission concluded that these commercial mobile radio
service (CMRS) providers need only deploy local number portability by the June 30, 1999,
deadline in switches in the 100 largest MSAs for which they receive a request at least nine months
prior to the deadline. On September 1, 1998, the Wireless Telecommunications Bureau
extended the deadline for implementation of number portability by CMRS providers to March 31,
2000.
5. In the First Report and Order, the Commission concluded, inter alia, that a
system of regional number portability databases, managed by independent local number portability
administrator(s) (LNPA(s)) would serve the public interest. The Commission directed the North
American Numbering Council (NANC), an advisory committee established pursuant to the
Federal Advisory Committee Act, to recommend as local number portability administrators one
or more independent, non-governmental entities that are not aligned with any particular
telecommunications industry segment within seven months of the initial meeting of the NANC.
The Commission also directed the NANC to make recommendations regarding, inter alia, the
duties of local number portability administrator(s), the location of regional databases, and
technical specifications for the regional databases. In the Second Report and Order, the
Commission adopted, with minor modifications, the NANC LNPA Working Group Report,
containing the recommendations of the NANC regarding the selection of LNPAs, the duties of
LNPAs, the locations of regional databases, and technical specifications for the regional
databases.
III. RECONSIDERATION ISSUES
A. Database Issues
1. Treatment of Industry Efforts to Implement Regional Databases Prior to
Issuance of NANC's Recommendations
a. Pleadings
6. BellSouth and U S WEST argue that, given the relatively short time frame the
Commission has allotted for carriers to implement number portability, the Commission should
expressly approve carriers' efforts to implement regional service management system (SMS)
database solutions taken prior to the issuance of the NANC LNPA Working Group Report.
b. Discussion
7. As noted above, the Commission has adopted the NANC LNPA Working Group
Report, which contains NANC's recommendations with respect to regional database
implementation, in a separate order. In particular, in that order, the Commission adopted the
NANC's recommendation that Lockheed Martin serve as local number portability database
administrator for the Northeast, Mid-Atlantic, Midwest and Southwest regions, and that Perot
Systems serve as the local number portability database administrator for the Southeast, Western
and West Coast regions.
8. On February 20, 1998, the Chief of the Common Carrier Bureau received a letter
from the Chairman of the NANC informing him that the Limited Liability Corporations (LLCs)
for the Southeast, Western, and West Coast regions reported to the NANC on local number
portability implementation. The LLCs for the Southeast, Western, and West Coast regions
reported that it was necessary to terminate their contracts with Perot Systems, with whom they
had experienced repeated performance problems, and to enter into contracts with Lockheed
Martin to serve as the LNPA to expedite implementation of local number portability. The NANC
members supported unanimously the decision to change vendors as "essential in successfully
implementing [number portability] in these regions."
9. We adopt the NANC Perot Recommendation to replace Perot Systems with
Lockheed Martin as the LNPA in the Southeast, Western and West Coast regions. The record
indicates that the NPAC database and associated facilities needed for long-term number
portability in the regions where Perot Systems was the database administrator were not ready for
intercompany testing as late as January 23, 1998, putting in jeopardy the dates for which number
portability was required to be made commercially available in these regions. The record indicates
that this delay was specifically due to the failure of the designated LNPA, Perot Systems, to
provide a stable software and hardware platform. We find that NANC Perot Recommendation
supports timely implementation of local number portability.
10. We find it unnecessary to authorize expressly or approve automatically carriers'
actions implementing regional database solutions that were taken prior to the issuance of the
NANC LNPA Working Group Report or the Commission's order acting on the NANC LNPA
Working Group Report. We conclude that the concerns raised by BellSouth and U S WEST in
this area have become moot in light of subsequent industry actions to implement local number
portability. Carriers, both on their own and through the regionally-based LLCs, have successfully
worked with the NANC to implement regional SMS database solutions.
2. Scope of the NANC's Responsibilities
a. Pleadings
11. BellSouth and Pacific contend that the Commission should clarify and, in certain
respects, restrict the scope of the NANC's responsibilities for implementation of number
portability.
b. Discussion
12. We find moot BellSouth's request that the NANC should address only SMS
database administration. The recommendations contained in the NANC LNPA Working Group
Report, adopted by the Commission in the Second Report and Order, address technical
specifications related to SMS database administration only and do not address SMS/SCP pairs.
13. In addition, we find moot BellSouth's request that carriers, and not the NANC,
propose standards for interfaces between regional SMS and downstream SCP databases. In the
Second Report and Order, the Commission adopted the NANC's recommended standards for
interfaces between regional SMS and downstream SCP databases. The carriers sharing in the
costs of developing, establishing and maintaining the regional databases had ample opportunity,
through the NANC, to participate in the development of interface recommendations.
14. Finally, we find moot Pacific's request that we direct an industry group other than
the NANC to address operational and technical issues that will arise as number portability is
implemented. In the Second Report and Order, the Commission found that the NANC represents
a broad cross-section of the industry, has developed substantial expertise in number portability
issues, and provides a valuable forum in which carriers are able to consider, at the national level,
possible ways to resolve the issues that arise as number portability is deployed within each number
portability region. As a result, the Commission charged the NANC with the task of addressing
technical and operational issues related to local number portability that may arise in the future.
3. Effect of Implementation of Long-Term Number Portability on Interim
Number Portability Methods
a. Pleadings
15. GTE interprets the First Report and Order as permitting LECs to withdraw
interim number portability methods when long-term number portability becomes available to
competing carriers. GTE is concerned, nevertheless, that some new competitors may want to
continue using interim number portability measures even after long-term number portability is
available because, GTE contends, the Commission's cost recovery methods for interim number
portability give significant cost breaks to new entrants, relative to long-term methods. GTE also
claims that the location routing number method of long-term number portability may impose
significantly greater costs on competing LECs than interim measures will. In addition, GTE
contends that retention of interim number portability methods after long-term number portability
has been implemented will increase the risk of design inefficiency, confusion, and technical
problems within the network. According to GTE, "a database solution to portability is most
beneficial and efficient only if all inter-switch calls to ported numbers make use of the system."
b. Discussion
16. We clarify that all LECs must discontinue using transitional number portability
methods in areas where a long-term number portability method has been implemented. In the
First Report and Order, the Commission concluded that the Act "contemplates a dynamic, not
static, definition of technically feasible number portability methods." Based on this finding, the
Commission required LECs to offer number portability, as soon as reasonably possible upon
receipt of a specific request, through remote call forwarding (RCF), direct inward dialing
(DID) and other comparable methods, because these are the only methods that currently are
technically feasible. However, the Commission also stated that:
[W]hen a number portability method that better satisfies the requirements of
section 251(b)(2) than currently available measures becomes technically feasible,
LECs must provide number portability by means of such method. In addition, we
find that the existing measures fail to satisfy our criteria set forth for any long-term
solution . . . . For these reasons, we do not believe that long-term use of the
currently available measures is in the public interest.
Because transitional number portability methods do not meet the performance criteria established
for long-term number portability, LECs may not continue to utilize such measures once long-term
solutions have been implemented. This conclusion is consistent with the Commission's finding in
the First Report and Order that the Act "clearly contemplates that [currently available] methods
should serve as only temporary measures until long-term portability is implemented." In
reaching this decision, we find it unnecessary to consider whether competing carriers would, as
GTE claims, have incentives to continue to use currently available methods of number portability
after long-term methods are available, if given the choice.
17. We also wish to clarify that, under the rules adopted in the First Report and
Order, RCF and DID are not the exclusive methods of providing number portability that LECs
are obligated to provide today. Section 52.27 of the Commission's rules provides:
All LECs shall provide transitional measures, which may consist of
Remote Call Forwarding (RCF), Flexible Direct Inward Dialing
(DID), or any other comparable and technically feasible method . .
. until such time as the LEC implements a long-term database
method for number portability in that area.
As the Commission stated in the First Report and Order, "LECs are required to offer number
portability through RCF, DID, and other comparable methods because they are the only methods
that currently are technically feasible." In specifically identifying RCF and DID as technically
feasible number portability methods, the Commission did not imply that RCF and DID are the
only methods through which LECs must port numbers until a permanent number portability
solution is implemented. Clearly, the references to RCF and DID were illustrative of the types of
measures that LECs must provide on a transitional basis. The Commission's rules require that
LECs must provide, on a transitional basis, any technically feasible method of number portability
comparable to RCF and DID.
18. In the two years since adoption of the First Report and Order, a number of state
commissions have ordered carriers to provide Route Indexing - Portability Hub (RI-PH) and
Directory Number Route Indexing (DNRI), based on findings of technical feasibility. In
particular, the California Public Utilities Commission ordered Pacific Bell and GTE to provide RI-
PH; Indiana has ordered Ameritech and GTE to provide RI-PH and DNRI; arbitrators in
Kansas and Missouri have ordered SBC to provide interim number portability using RI-PH and
DNRI; and GTE has been ordered to provide RI-PH and DNRI in Florida, Missouri, South
Carolina, and Texas, and to provide RI-PH in Alabama and DNRI in Virginia. Additionally,
several LECs have voluntarily agreed to provide RI-PH and DNRI: NYNEX, prior to its merger
with Bell Atlantic, agreed to provide DNRI in the six states in its service territory; BellSouth has
agreed to provide both RI-PH and DNRI in all nine of the states in its service territory; U S
WEST agreed to provide RI-PH and DNRI in each of the fourteen states in its service territory;
and Sprint Local has agreed to provide RI-PH to AT&T nationwide. To date, LECs in more
than half the states have either agreed or been ordered to provide RI-PH and DNRI as technically
feasible methods of providing number portability prior to deployment of a database method. We
therefore conclude, consistent with the Commission's prior findings in this docket and with the
rules and policies established in the Commission's Local Competition Order, that RCF, DID,
DNRI and RI-PH are comparable and technically feasible transitional methods of providing
number portability. We conclude that state commissions may determine that additional methods
are comparable and technically feasible, as well.
19. In adopting the requirements for transitional number portability in the First Report
and Order, the Commission relied on the fact that no network modifications would be necessary
in order to provide number portability on a transitional basis, prior to implementation of a long-
term database solution. In particular, in adopting section 52.27, the Commission concluded that it
is not unduly burdensome for LECs to provide number portability through RCF and DID because
these methods are offered as retail services in a number of states today.
20. Since adoption of the First Report and Order, certain new entrants have sought
other transitional methods of number portability that are better suited, in their view, to their
particular business needs. A number of carriers make available other transitional methods of
number portability, such as RI-PH and DNRI, only if requested by a competing carrier. We
conclude that it is not per se unreasonable for a LEC to make available transitional number
portability methods only upon request, provided that the LEC does not deliberately use the
request process to delay competitive entry. We would expect a LEC to respond expeditiously to
a request for a particular method of transitional number portability.
21. The First Report and Order did not address the issue of which carrier has the right
to select the particular transitional method of number portability to be provided when there is
more than one technically feasible method. We amend the Commission's rules, on our own
motion, to clarify that a LEC is required to furnish the specific method of currently available
number portability that a competing carrier requests, provided that provision of the requested
method is not unduly burdensome. We believe that the burden of fulfilling a competing carrier's
request for a specific method of providing number portability will be minimal if the functionality
described by a requested currently available method already exists in the network. As the
Commission noted in the First Report and Order, the capability to provide number portability
through currently available methods, such as RCF and DID, already exists in most networks, and
no additional network upgrades should be necessary in order to provide number portability in this
manner. We clarify this finding by adding that, to the extent no network upgrades are necessary
in order to provide number portability through methods other than RCF or DID, a LEC must
make such methods available upon request as well.
22. Given that a number of states have ordered LECs to provide RI-PH and DNRI, we
presume that RI-PH and DNRI are not unduly burdensome to provide. We conclude that the
burden should be on the LEC providing number portability to overcome this presumption. In
particular, consistent with the pro-competitive goals of the Act, we conclude that the LEC shall
bear the burden of demonstrating that a particular requested transitional number portability
method is unduly burdensome, and therefore should not be provided to a requesting carrier. In
determining whether a specific method is unduly burdensome, relevant factors are the extent of
network upgrades needed to provide the requested method, the cost of such upgrades, the
business needs of the requesting carrier, and the timetable for deployment of a long-term number
portability method in that particular geographic location.
4. Issues Related to Performance Criteria
a. Pleadings
23. Nextel and AirTouch raise issues related to the Commission's performance criteria
for long-term number portability. While Nextel supports the Commission's decision not to choose
a particular long-term number portability methodology, Nextel claims that the Commission's
approach to number portability implementation will permit number portability methodologies to
be deployed on a state-by-state basis.
24. According to Airtouch, language in the First Report and Order presupposes that
all carriers will upgrade their networks to Intelligent Network (IN), Advanced Intelligent
Network (AIN) or Wireless Intelligent Network (WIN) capabilities in order to perform the
database dips needed to route calls to ported numbers. AirTouch urges the Commission to
clarify that carriers may arrange with other carriers to perform database dips and other routing
functions.
b. Discussion
25. We reject Nextel's request that the Commission establish an industry committee to
develop a single, nationwide number portability methodology. As a threshold matter, we disagree
with Nextel's underlying premise that number portability methodology decisions will be made on a
state-by-state basis. In the First Report and Order, the Commission specifically concluded that
regionally deployed databases best serve the public interest. Because the harm that Nextel
raised in its petition (i.e., the deployment of a different number portability plan in each state
resulting in dramatically increased costs for multi-state providers) has not occurred and is not
likely to occur, we conclude that it is unnecessary to grant Nextel's request.
26. In addition, we note that, to a great extent, the NANC already has served the
function that Nextel asserts is necessary. The NANC was charged with developing
recommendations regarding the implementation of number portability, in large part, "to ensure
consistency and to provide a national perspective on number portability issues, as well as to
reduce the costs of implementing a national number portability plan." Further, the NANC
includes representatives from each of the constituencies that Nextel identifies: state and federal
officials, service providers, and equipment manufacturers. Moreover, we point out that, to date,
the industry and state/regional workshops have chosen the Location Routing Number (LRN)
methodology as the preferred method of number portability, and carriers have proceeded to
implement LRN. As such, it would appear that states have chosen the same number portability
method, rather than several incompatible methods, as Nextel feared.
27. We grant AirTouch's request for clarification that carriers may arrange with other
carriers to perform database dips and other routing functions. Contrary to AirTouch's claims, we
have not assumed, nor do we require, that all carriers must satisfy their number portability
obligations by upgrading their networks to perform database dips. In the Second Report and
Order, the Commission concluded that, although the carrier in the call routing process
immediately preceding the terminating carrier shall be responsible for ensuring that number
portability database dips are performed, that carrier can meet this obligation by either querying the
number portability database itself or by arranging with another entity to perform database dips on
its behalf.
B. Location Portability
1. Pleadings
28. SBC argues that the Commission should not address location portability at this
time because the Act did not contemplate implementation of such portability.
2. Discussion
29. We decline to adopt SBC's proposal that the Commission decide now that we will
not consider location portability until service provider number portability is successfully deployed
in the 100 largest MSAs. The Commission concluded in the First Report and Order that the
requirement that all LECs provide local number portability (i.e., service provider portability)
pursuant to section 251(b)(2) does not include location portability because the Act's number
portability mandate is limited to situations when users remain "at the same location" when
switching from one telecommunications carrier to another. Although we did not require LECs
to provide location portability when the First Report and Order was issued, we nevertheless
concluded that nothing in the Act would preclude us from mandating location portability if, in the
future, we determine that location portability is in the public interest.
30. The Commission has no current plans to address location portability at this time.
We need not and do not address the issue of whether it may be in the public interest to require the
implementation of location portability at some point in the future.
C. 500 and 900 Number Portability
31. A consumer subscribing to 500 number service receives a 500 "area code" number
that can be programmed to deliver calls to various locations. A 900 number service is a calling
service providing businesses with a method of delivering information, advice, or consultations
quickly and conveniently by telephone. Individuals calling 500 or 900 subscribers dial 500 or
900 plus a 7-digit number (NXX-XXXX). When a call is placed to a 500 or 900 service number,
the originating LEC uses the NXX of the dialed number to identify the carrier serving either the
500 number subscriber, or the business operating the 900 number service. The LEC then routes
the call over the appropriate carrier's network. Although consumers can purchase 500 and 900
services from either LECs or interexchange carriers (IXCs), most users of 500 and 900 number
services obtain their numbers from IXCs. The First Report and Order concluded that, pursuant
to section 251(b)(2) of the Act, LECs -- but not IXCs -- are obligated to make available service
provider portability for 500 and 900 number service to the extent "technically feasible."
32. In the First Report and Order, the Commission concluded there was insufficient
evidence in the record to determine whether it is technically feasible for LECs to make their
assigned 500 and 900 numbers portable. The Commission directed the Industry Numbering
Committee (INC) to examine this issue and to file a report of its findings with the Commission
within twelve months of the effective date of the First Report and Order. The Commission
stated that "[u]pon receipt of this report, we will take appropriate action under the . . . Act."
The INC released its report on July 2, 1997.
1. Provision of 500 and 900 Number Portability By Carriers Other Than LECs
a. Pleadings
33. Several incumbent LECs contend that it is unfair for the Commission to make only
500 and 900 numbers provided by LECs portable, rather than requiring portability for 500 and
900 numbers provided by all carriers. No IXC filed comments on this issue.
b. Discussion
34. The number portability requirements of section 251(b)(2) apply only to LECs.
Specifically, section 251(b)(2) imposes a duty on "each local exchange carrier . . . to provide, to
the extent technically feasible, number portability in accordance with requirements prescribed by
the Commission." Thus, we cannot rely on section 251 for authority to require IXCs or other
non-LECs to provide number portability for 500 and/or 900 number service. We therefore affirm
the Commission's conclusion in the First Report and Order that IXCs are not required under
section 251(b)(2) to make their assigned 500 and 900 numbers portable to any other carrier
offering 500 and 900 number service.
35. We, however, may possess independent authority under sections 1, 2 and 4(i) of
the Act to require other carriers to provide number portability for 500 and/or 900 number service
to the extent that such portability is in the public interest. Section 1 requires the Commission to
make available to all people of the United States "a rapid, efficient, Nation-wide, and world-wide
wire and radio communication service." Section 1 of the Act thus gives the Commission
jurisdiction to ensure that the portability of all telephone numbers within the United States,
including 500 and 900 numbers, is handled efficiently and fairly. 500 and 900 number portability
would promote this mandate. 500 and 900 number portability also would promote the efficient
and uniform treatment of numbering that is essential to the efficient delivery of interstate and
international telecommunications. Section 2 gives the Commission authority to regulate interstate
common carriers, including those that provide 500 and 900 number services. Section 4(i) grants
the Commission authority to "perform any and all acts, make such rules and regulations, and issue
such orders, not inconsistent with [the Act], as may be necessary in the execution of its
functions." The conclusion that we may possess independent authority to require all carriers to
provide number portability for their assigned 500 and 900 numbers would be similar to the
Commission's decision in the First Report and Order to rely on its general rulemaking authority to
order number portability for CMRS providers, and to reserve the Commission's authority to
require service and location portability, even though the Commission concluded that these types
of number portability are not specifically required by section 251(b)(2). This result would also
be consistent with our exercise of authority under section 1, 2 and 4(i) to require the Bell
Operating Companies and GTE to provide number portability for 800 numbers even prior to
enactment of the 1996 Act.
36. As the Commission noted in the First Report and Order, most users of 500 and
900 number services today have obtained their numbers from IXCs. Thus, "as a practical
matter, portability for the vast majority of 500 and 900 numbers can occur only if the IXC
releases to the new carrier management of the 500 or 900 number that is to be ported." If only
LECs were required to make their 500 and 900 numbers portable, the vast majority of 500 and
900 numbers would not be portable, and competing 500 and 900 service providers would face a
significant impediment in persuading customers to switch carriers. Imposing portability
obligations on all 500 and 900 service providers would make it possible for all customers of 500
and 900 services to switch providers without changing their numbers. This, in turn, would
promote competition in the 500 and 900 services markets.
37. We decline to rule at this time, however, on our authority to require all carriers to
offer 500 and 900 number portability. As discussed in paragraphs 38-43, below, we will first
determine whether 500 and/or 900 number portability by all carriers is technically feasible. In the
event that it is determined that 500 and 900 number portability by all carriers is technically
feasible, we will address our authority to impose the same number portability requirements on all
carriers that provide 500 and 900 services.
2. Implementation of 500 and 900 Number Portability
a. Pleadings
38. GTE argues that there is insufficient evidence in the record to determine whether
500 and 900 number portability is even technically possible. Consequently, GTE argues that the
Commission should decline to address 500 and 900 number portability in this proceeding.
USTA challenges the Commission's decision to delegate to the INC the task of reviewing the
technical feasibility of 500 and 900 portability. SBC argues that the Commission must consider
the economic feasibility of 500 and 900 number portability as well as technical feasibility.
b. Discussion
39. As a threshold matter, we are not persuaded by GTE that we should decline to
address 500 and 900 number portability in this proceeding because we lack evidence on the
technical feasibility of such portability. Instead we take further action to obtain the necessary
evidence.
40. We reject USTA's suggestion that the Commission should not have directed the
INC to review the technical feasibility of 500 and 900 number portability. The INC is an industry
body that provides an open forum to address and resolve industry-wide issues associated with the
non-policy-related planning, administration, allocation, assignment and use of numbering
resources within the North American Numbering Plan (NANP) area. The INC worked
diligently to fulfill its directive from the Commission in this docket, and released its report on July
2, 1997.
41. As discussed above, we decline to determine at this time whether we have
independent rulemaking authority to require number portability for 500 and 900 numbers assigned
to all carriers, if that would serve the public interest. In its report, the INC expressly limited its
analysis to the technical feasibility of porting numbers assigned to LECs between LECs; it did not
address the technical feasibility of LEC-to-non-LEC, non-LEC-to-LEC, or non-LEC-to-non-LEC
portability for 500 or 900 numbers. In order to evaluate whether the public interest would be
served by mandating 500 and 900 number portability for all carriers, we must first determine
whether number portability for the entire 500 and 900 number resource is technically feasible. We
therefore conclude that we should expand the scope of the inquiry that the Commission previously
delegated to the INC. We direct the NANC, which may refer the issues to the INC, to examine
the following questions:
1. Is it technically feasible for all 500 number service providers to implement 500
number portability using existing network and administrative database capabilities?
2. If the answer to Question #1 is "No," is technology available to develop the
appropriate network and administrative database capabilities to deploy 500 number
portability in the future?
3. If the answer to Question #2 is "Yes," how long would it take to develop and
deploy the necessary network infrastructure for 500 number portability, upon
receipt of a regulatory directive?
4. Is it technically feasible for all 900 number service providers to implement 900
number portability using existing network and administrative database capabilities?
5. If the answer to Question #4 is "No," is technology available to develop the
appropriate network and administrative database capabilities to deploy 900 number
portability in the future?
6. If the answer to Question #5 is "Yes," how long would it take to develop and
deploy the necessary network infrastructure for 900 number portability, upon
receipt of a regulatory directive?
42. The NANC is directed to file a report addressing the questions referred to it in this
Second Memorandum Opinion and Order on Reconsideration within twelve months of the
effective date of this order. Upon receipt of the NANC's report, we will take appropriate action.
43. We decline to rule at this time on SBC's request that we consider economic
feasibility, as well as technical feasibility, in evaluating the provision of 500 and 900 number
portability. As a practical matter, we believe that it is premature to determine what factors may
be appropriate to consider with respect to the possible implementation of portability for such
numbers, if we ultimately conclude we have jurisdiction to order portability of those numbers for
all carriers.
D. Wireless Issues
44. In the First Report and Order, the Commission concluded that number portability
must be provided by cellular, broadband PCS, and covered SMR providers. For the purposes
of number portability,
[t]he term "covered SMR" means either 800 MHz and 900 MHz SMR licensees
that hold geographic area licenses or incumbent wide area SMR licensees that offer
real-time, two-way switched voice service that is interconnected with the public
switched network either on a stand-alone basis or packaged with other
telecommunications services. This term does not include local SMR licensees
offering mainly dispatch services to specialized customers in a non-cellular
configuration, licensees offering only data, one-way, or stored voice services on an
interconnected basis, or any SMR provider that is not interconnected to the public
switched network.
45. With respect to wireless carriers, the Commission concluded that number
portability will facilitate the entry of new service providers, such as broadband PCS and covered
SMR, into CMRS markets currently dominated by cellular providers, and competition from these
new entrants will provide incentives for incumbent cellular providers to lower prices and increase
service choice and quality. The Commission also noted that number portability will promote
competition between CMRS and wireline service providers as CMRS providers offer comparable
local exchange and fixed commercial radio services. The Commission determined that it would
not adopt a number portability schedule for other categories of CMRS providers (including SMR
operators that do not fit the definition of "covered SMR") because these other providers offer
services that "currently will have little competitive impact on competition between providers of
wireless telephony service or between wireless and wireline carriers."
1. Definition of "Covered SMR"
a. Pleadings
46. Several parties ask the Commission to reconsider or clarify the definition of
"covered SMR" set forth in section 52.21(c) of the Commission's rules in petitions for
reconsideration of the First Report and Order. AMTA contends that the definition of covered
SMR encompasses SMR licensees that the Commission did not intend to include, and does not
accurately reflect the policy position articulated in the First Report and Order. AMTA argues
that incumbent SMR providers had no choice but to obtain geographic area licenses to ensure
expansion opportunities on their channels, and therefore they fall within the definition of covered
SMR even though they may have traditional SMR systems that do not compete in the consumer-
oriented wireless market. Moreover, AMTA asserts that all cellular and cellular-like PCS
systems, unlike traditional, local SMR facilities, have an in-network switching facility. According
to AMTA, in-network switching facilities enable wireless systems to reuse frequencies and
thereby develop sufficient capacity to accommodate a mass market subscriber base, and to hand-
off communications between sites seamlessly without subscriber intervention. AMTA proposes
that the definition of covered SMR reflect this distinction between SMR systems that have in-
network switching facilities and those that do not. Alternatively, AMTA proposes that the
Commission modify the definition of covered SMR to apply only to systems serving 20,000 or
more subscribers nationwide, as only those larger systems will potentially compete with
broadband CMRS and wireline providers.
47. In addition, on May 15, 1997, AMTA filed a Petition for Reconsideration of the
Commission's First Order on Reconsideration requesting that the Commission clarify the
definition of "covered SMR" as requested in AMTA's pending petition for reconsideration.
Further, because of the technical difficulties certain SMR licensees would confront in meeting
their number portability obligations if included in the definition of covered SMR, AMTA requests
that the Commission toll the number portability implementation deadlines for SMR systems until
the Commission resolves the definitional issue. Because the two petitions for reconsideration
filed by AMTA raise similar issues, we address them both in the instant decision.
48. Nextel urges the Commission to amend or clarify the definition of covered SMR to
ensure the definition: (1) excludes local SMR licensees offering "mainly dispatch services to
specialized customers in a non-cellular configuration"; and (2) encompasses those systems that
offer two-way voice services using a mobile telephone switching facility. Nextel adds that the
Commission should clarify that the definition of covered SMR should be applied on a system-by-
system basis, rather than on a licensee basis.
49. Small Business in Telecommunications (SBT) urges the Commission to delete part
of the definition of covered SMR so as to remove the potential implication that SMR providers
that operate in a non-cellular system configuration, but do not offer "mainly dispatch services,"
are covered SMR providers. According to SBT, these interconnected local SMR providers
cannot compete in the mass market for real-time, two-way voice services.
50. In reply comments, RAM Mobile Data USA Limited Partnership (RMD) argues
that the determination of whether an SMR system should be considered covered SMR for number
portability purposes should turn on the functional uses of the system and the market in which it
competes, not the size of the system, as suggested by AMTA. RMD explains that data-only
systems compete in different markets and are subject to different competitive concerns than real-
time, two-way voice SMR systems. Further, RMD asserts that customers of data-only systems
have no telephone number to port; rather, these customers are assigned a unique identification
code unrelated to local exchange telephone numbers. Thus, RMD recommends that the
Commission continue to exclude data-only SMR systems from number portability requirements.
b. Discussion
51. The term "covered SMR" was intended to include SMR licensees that offer
services that compete, or potentially compete, with services offered by cellular and broadband
PCS licensees. The Commission concluded that because cellular, broadband PCS, and certain
SMR providers will compete directly with one another, and potentially will compete in the future
with wireline carriers, number portability was sufficiently important to the development of
competition that it should be required for these carriers. Within the SMR service, however, it
was clear that some providers would be offering mass market, two-way, real-time, interconnected
voice services that compete with the offerings of traditional cellular and broadband PCS
providers, and others would not. The definition of covered SMR is intended to distinguish
between these two groups of SMR providers.
52. We agree with the petitioners that the existing definition of "covered SMR"
imperfectly accomplishes its intended purpose. In particular, some wide-area licensees may offer
primarily dispatch services that do not significantly compete with traditional cellular service. We
further agree that the best indicator of an SMR provider's ability to compete with wireless and
wireline providers in the two-way, real-time voice market is whether the provider's system has in-
network switching capability. This switching capability would allow an SMR provider to hand-off
calls seamlessly as subscribers move between sites in the service area, and would allow the
provider to "reuse" the same frequency in different portions of the service area, as cellular and
PCS systems do. Thus, the provider would be able to compete in the market for two-way, real-
time voice services, while carriers who lack switching capability would not be competitive in this
market.
53. We note also that it may be infeasible, from a technical standpoint, to require SMR
providers whose systems lack an in-network switching capability to provide number portability.
Traditional SMR providers may have several lines interconnecting their SMR systems to the
public switched network, but the telephone numbers assigned to these lines by the LEC are
typically shared by all of the SMR provider's customers. Such providers may give their
customers the option of paying more to be able to call and receive calls from customers on the
public switched network ("interconnected service"). The SMR customers who choose this
optional service are assigned a second number, analogous to a personal identification number
(PIN), by the SMR provider; incoming callers dial both numbers to reach the SMR customer.
The SMR customer does not have its own number to be ported, because the first number
(assigned by the LEC) is shared with the other SMR customers. Therefore, in order for a
customer leaving an SMR system that is configured in this manner to port a public telephone
number, all customers remaining with the system would be without service for that particular line,
which would have a negative impact on those customers. Additionally, the SMR subscriber
would be porting a number that was never uniquely associated with that subscriber. We believe
it is neither practical nor necessary to require traditionally configured SMR systems to reconfigure
their systems so that every interconnected customer has its own public telephone number. Indeed,
to require such reconfiguration would essentially force traditional SMR customers to utilize a type
of service that presumably they have elected not to use, as these customers could have subscribed
to cellular and PCS service if they wished to have their own public telephone numbers.
54. In addition, we conclude that the concept of applying number portability
requirements only to certain categories of "covered" carriers should be extended to cellular and
broadband PCS. Like SMR licensees, cellular and broadband PCS licensees should not be
required to provide number portability if they do not compete in the market for two-way,
interconnected, real-time voice services. Although cellular and broadband PCS providers
generally offer the types of services that the number portability rule is intended to cover, the
Commission's rules do not require them to offer only these services. Moreover, the likelihood
that some providers may offer other services over cellular or broadband PCS spectrum is
increased by recent rule changes and proposals allowing licensees to disaggregate their
spectrum. Consequently, we conclude that any CMRS licensee providing primarily dispatch
service with a non-cellular type of system, whether on spectrum allocated for SMR or on another
frequency band, should be excluded from the number portability requirements. Thus, a CMRS
licensee providing primarily dispatch service with a non-cellular type of system is exempt from
offering number portability. Furthermore, we agree with RMD that the Commission's rule should
continue to exclude data-only systems and other systems that do not offer two-way, real-time
voice services, regardless of the type of CMRS system used. At the same time, we believe that
CMRS systems that do compete with traditional cellular service should be covered regardless of
the spectrum over which they operate.
55. For the foregoing reasons, we adopt, with some modification, the definition
suggested by the petitioners:
"Covered CMRS" systems offer real-time, two-way switched voice service that are
interconnected with the public switched network, and utilize an in-network switching
facility which enables the provider to reuse frequencies and accomplish seamless hand-offs
of subscriber calls."
With this change, number portability must be provided by "covered CMRS" providers, which may
hold licenses in cellular, PCS, SMR or any other services.
56. We also clarify, in response to Nextel's petition, that the definition of covered
CMRS should be applied on a system-by-system basis. That is, an entity may hold more than one
CMRS license, but the entity is required to provide number portability only with respect to
licenses that satisfy the definition of covered CMRS.
57. In addition, we reject AMTA's proposal that the covered SMR definition apply
only to systems serving 20,000 or more subscribers nationwide. The approach we adopt above
is a functional one, which is based on whether the provider offers a certain type of service.
AMTA provides no basis for concluding that SMR providers would be more likely to be able to
compete in the market for two-way, interconnected, real-time voice services simply because their
systems serve more than 20,000 subscribers. Indeed, AMTA itself states that this solution "is not
tailored as precisely to reflect the system distinctions identified by the FCC." We agree with
this assessment and find that determining whether an SMR system is required to provide number
portability based on how many subscribers it serves would be arbitrary, and could discourage
SMR providers from expanding their systems.
58. Further, we dismiss SBT's petition for reconsideration as untimely. Section 405 of
the Act, as amended, provides, in relevant part, that: "[a] petition for reconsideration must be
filed within thirty days from the day upon which public notice is given of the order, decision,
report, or action complained of." Section 1.4(b)(1) of the Commission's rules provides that the
date of public notice "[f]or documents in notice and comment rule making proceedings, including
summaries thereof, [is] the date of publication in the Federal Register." Public notice in this
case was given on July 26, 1996, the date on which the First Report and Order was published in
the Federal Register. Therefore, petitions to reconsider that decision were due on or before
August 26, 1996. Because the time period for filing petitions for reconsideration is prescribed by
statute, the Commission may not, except in extraordinary cases, waive or extend the filing
period. SBT has not demonstrated that its late-filed petition fits into this narrow exception;
indeed, SBT has not even moved for leave to file its petition. As such, we dismiss SBT's petition.
59. Finally, we dismiss AMTA's petition for reconsideration of the First Order on
Reconsideration as moot. By amending, in this Order, the Commission's rules to ensure that only
those CMRS carriers that compete in the market for two-way, interconnected, real-time voice
services are subject to the Commission's number portability requirements, we grant the relief that
AMTA requests. Moreover, because we have clarified that CMRS licensees providing primarily
dispatch service with a non-cellular type of system are exempt from the Commission's number
portability requirements, there is no need to extend the implementation period for such licensees.
2. Geographic Scope of Number Portability for Wireless Carriers
a. Pleadings
60. AirTouch asks the Commission to limit the geographic scope of number portability
as applied to wireless carriers. Specifically, AirTouch submits that number portability in a
wireless environment should be limited to those carriers already serving the "area code" or "NPA"
of the ported wireless number. According to AirTouch, because the service areas of certain
categories of wireless carriers overlap (e.g., cellular and PCS), if a wireless subscriber were
permitted to port its number to carriers that do not otherwise serve the NPA of the number to be
ported, calls to that subscriber would no longer terminate in the geographic region associated with
the NPA of the ported number, even if the service area of the customer's original carrier overlaps
with the service area of the customer's new carrier. Theoretically, by continuing to switch
wireless carriers, each time porting its number to a new carrier with a service area that overlaps
with the service area of its previous carrier, a subscriber thus could create a "daisy chain" of
overlapping service areas and thereby port a number across the country, carrier by carrier. This
"daisy chain" effect would, AirTouch submits, result in de facto nationwide location portability.
In addition, AirTouch contends that, without the NPA restriction it proposes, number portability
would require an impossibly large database to allow queries by every carrier in the country that
originates a call to the porting customer's NPA in order to locate the proper switches to terminate
calls.
b. Discussion
61. As AirTouch suggests, requiring service provider portability in a wireless
environment, without imposing any geographic boundaries, could theoretically result in de facto
nationwide location portability, which the Commission explicitly declined to adopt in the First
Report and Order. Conversely, limiting number portability in a wireless environment to those
carriers already serving the NPA of the ported wireless number may thwart the pro-competitive
goals of the Act. A single geographic area may now have multiple NPAs due to area code
overlays. Typically, wireless carriers provide their customers with the choice of NPAs when they
have more than one switch in the geographic market, but some new entrants may only have one or
two switches with all numbers coming out of the same NPA. Limiting number portability in a
wireless environment to those carriers already serving the NPA of the ported wireless number
may discourage customers from switching wireless carriers if they cannot port their number to a
different NPA even though the number continues to be used in the same geographic market. As
noted above, wireless carriers are not obligated to port numbers until March 31, 2000.
Furthermore, the NANC is currently examining the myriad of complex issues surrounding wireless
number portability. Consequently, we defer a decision on this matter pending further analysis
by the NANC. We encourage AirTouch to participate in the NANC's standards development
process to ensure consideration of AirTouch's concerns.
3. Preemption of State Number Portability Requirements for CMRS Providers
a. Pleadings
62. Bell Atlantic NYNEX Mobile (BANM) and the Cellular Telecommunications
Industry Association (CTIA) ask that the Commission explicitly preempt state CMRS number
portability requirements. BANM claims that number portability has inseverable interstate and
intrastate aspects, and that preemption is necessary to protect the federal objective of deploying a
national number portability regime. BANM argues that preemption is especially important for
CMRS providers because many CMRS systems span state lines and cannot accommodate multiple
portability requirements. CTIA agrees that the Commission should preempt state CMRS
number portability requirements, asserting that, even if it is possible for multi-state systems to
accommodate multiple portability architectures and service requirements, inconsistent state
policies will add unnecessary complexity and dramatically increase implementation costs for
multi-state CMRS providers.
b. Discussion
63. We reject the request for preemption of state number portability requirements for
CMRS carriers. While, under certain circumstances, the Commission has authority to preempt
state law, the record is devoid of any evidence that such action is warranted at this time. Pursuant
to the Supremacy Clause of the U.S. Constitution, Congress has the power to preempt state laws
or regulations. As explained by the Supreme Court in Louisiana Public Service Commission v.
FCC:
Pre-emption occurs when Congress, in enacting a federal statute, expresses a clear
intent to preempt state law, when there is outright or actual conflict between
federal and state law, where compliance with both federal and state law is in effect
physically impossible . . . or where the state law stands as an obstacle to the
accomplishment and execution of the full objectives of Congress.
Moreover, the Supreme Court has also made it clear that "[p]re-emption may result not only from
action taken by Congress itself; a federal agency acting within the scope of its congressionally
delegated authority may preempt state regulation."
64. The petitioners have failed to identify any specific state number portability
requirements that apply to CMRS carriers that conflict with federal number portability mandates
or objectives. Nor is there a basis in the current record for concluding that it will be impossible
for carriers to comply with federal and state CMRS number portability requirements. Thus, we
decline to consider the preemption of state number portability requirements for CMRS carriers
based on the record before us.
65. In addition, despite the conclusory assertions of the petitioners to the contrary, the
record does not indicate that there are, or will be, state number portability requirements applicable
to CMRS carriers that will conflict with the requirements of any other state, such that CMRS
carriers will be required to accommodate multiple portability architectures and/or service
requirements. Indeed, the framework for implementing number portability is designed, in part, to
minimize such burdens. For example, in the First Report and Order, the Commission directed
one entity -- the NANC -- to develop recommendations for technical and operational standards
with respect to regional number portability databases. Accordingly, we expect there will be a
high degree of national uniformity in this regard. Moreover, as discussed above, the industry and
state/regional workshops chose a single method as the preferred method for number portability.
In short, it is unlikely that CMRS systems that span state lines will be required to accommodate
multiple portability architectures that differ significantly from one another.
IV. ORDERING CLAUSES
66. IT IS ORDERED that, pursuant to the authority contained in sections 1, 4(i), 4(j),
201-205, 218, 251, and 332 of the Communications Act as amended, 47 U.S.C. 151, 154(i),
154(j), 201-205, 218, 251 and 332, Part 20 of the Commission's rules, 47 C.F.R 20, and Part 52
of the Commission's rules, 47 C.F.R. 52, are AMENDED as set forth in Appendix B hereto.
67. IT IS FURTHER ORDERED that the Petitions for Reconsideration and/or
Clarification ARE GRANTED to the extent indicated herein and otherwise ARE DENIED.
68. IT IS FURTHER ORDERED that the policies, rules, and requirements set forth
herein ARE ADOPTED, effective 30 days after publication of a summary of this Second
Reconsideration Order in the Federal Register.
69. IT IS FURTHER ORDERED that the Petition for Reconsideration of Small
Business in Telecommunications is hereby dismissed.
70. IT IS FURTHER ORDERED that the Petition for Reconsideration filed by the
Ameritech Mobile Telecommunications Association, Inc. on May 15, 1997, is dismissed as moot.
71. IT IS FURTHER ORDERED that the Commission's Office of Public Affairs,
Reference Operations Division, SHALL SEND a copy of this Second Memorandum Opinion and
Order on Reconsideration, including the Second Supplemental Final Regulatory Flexibility
Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.
FEDERAL COMMUNICATIONS COMMISSION
Magalie Roman Salas
Secretary APPENDIX A - LIST OF PARTIES
Petitions for Reconsideration/Clarification (filed 8/26/96):
AirTouch Communications, Inc. [AirTouch]
American Communications Services, Inc. [ACSI]
American Mobile Telecommunications, Inc. [AMTA]
Bell Atlantic
Bell Atlantic NYNEX Mobile, Inc. [BANM]
BellSouth Corporation and BellSouth Telecommunications, Inc. [BellSouth]
Cellular Telecommunications Industry Association [CTIA]
Cincinnati Bell Telephone Company [Cincinnati Bell]
GTE Service Corporation [GTE]
John Staurulakis, Inc. [JSI]
KMC Telecom, Inc. [KMC]
MCI Telecommunications Corporation and MCIMetro [MCI]
National Exchange Carrier Association, Inc. [NECA]
National Telephone Cooperative Association and Organization for the
Promotion and Advancement of Small Telecommunications Companies
[NTCA/OPASTCO]
Nextel Communications, Inc. [Nextel]
NEXTLINK Communications LLC [NEXTLINK]
NYNEX Telephone Companies [NYNEX]
Pacific Telesis Group, Pacific Bell, Nevada Bell, Pacific Bell Mobile Services [Pacific]
SBC Communications Inc. [SBC]
United States Telephone Association [USTA]
U S WEST, Inc. [U S West]
Petitions for Reconsideration/Clarification (late-filed 8/30/96):
Small Business in Telecommunications, Inc. [SBT]
Oppositions/Comments to Petitions for Reconsideration (filed 9/27/96):
ALLTEL Telephone Services Corporation [ALLTEL]
AT&T Corp. [AT&T]
Association for Local Telecommunications Services [ALTS]
Bell Atlantic
BellSouth
CTIA
Cincinnati Bell
GTE
IntelCom Group (USA), Inc. [ICG]
MCI
NEXTLINK
NYNEX
RAM Mobile Data USA Limited Partnership [RMD]
Rural Telecommunications Group [RTG]
Pacific
Sprint Corporation [Sprint]
Time Warner Communications Holdings, Inc. [Time Warner]
USTA
Oppositions/Comments to Petitions for Reconsideration (late-filed 9/30/96):
Telecommunications Resellers Association [TRA]
Replies (filed 10/7/96):
Ameritech
NEXTLINK
Teleport Communications Group [TCG]
Rural Cellular Association [RCA]
NTCA/OPASTCO
Replies (filed 10/10/96):
ACSI
Bell Atlantic
BellSouth
Cincinnati Bell
GTE
MCI
NYNEX
Pacific
SBC
USTA
U S WEST
Petition for Reconsideration (filed May 15, 1997):
AMTA
Comments to Petition for Reconsideration (filed June 5, 1997):
Motorola, Inc.
Nextel
Personal Communications Industry Association (PCIA)
APPENDIX B - Final Rules
AMENDMENTS TO THE CODE OF FEDERAL REGULATIONS
PART 52 -- NUMBERING
Part 52 of Title 47 of the Code of Federal Regulations (C.F.R.) is amended as follows:
1. Section 52.21 is amended by revising paragraph (c) to read as follows:
52.21 Definitions.
*****
(c) The term covered CMRS means broadband PCS, cellular, and 800/900 MHz SMR
licensees that (1) hold geographic area licenses or are incumbent SMR wide area licensees,
and (2) offer real-time, two-way switched voice service, are interconnected with the public
switched network, and utilize an in-network switching facility that enables such CMRS
systems to reuse frequencies and accomplish seamless hand-offs of subscriber calls.
(q) The term transitional number portability measure means a method that allows one
local exchange carrier to transfer telephone numbers from its network to the network of
another telecommunications carrier, but does not comply with the performance criteria set
forth in 52.3(a). Transitional number portability measures are technically feasible
methods of providing number portability including Remote Call Forwarding (RCF), Direct
Inward Dialing (DID), Route Indexing - Portability Hub (RI-PH), Directory Number
Route Indexing (DNRI) and other comparable methods.
2. Section 52.27 is amended by adding a sentence at the end of the section to read as
follows:
52.27 Deployment of Transitional Measures for Number Portability.
(a) All LECs shall provide transitional number portability measures, as defined in section
52.21(q) of this chapter, 47 C.F.R. 52.21(q), as soon as reasonably possible upon receipt
of a specific request from another telecommunications carrier, until such time as the LEC
implements a long-term database method for number portability in that area.
(b) A LEC must provide the particular transitional number portability measure requested
by a telecommunications carrier, except as set forth in subsection (c) below.
(c) A LEC that does not provide a requested transitional number portability measure must
demonstrate that provision of the requested transitional number portability measure either
is not technically feasible or if technically feasible, is unduly burdensome.
(1) Previous successful provision of a particular transitional number portability
measure by any LEC constitutes substantial evidence that the particular method is
technically feasible.
(2) In determining whether provision of a transitional number portability measure
is unduly burdensome, relevant factors to consider are the extent of network
upgrades needed to provide that particular method, the cost of such upgrades, the
business needs of the requesting carrier, and the timetable for deployment of a
long-term number portability method in that particular geographic location.
(d) LECs must discontinue using transitional number portability measures in areas where
a long-term number portability method has been implemented.
3. Section 52.31 is amended by revising paragraphs (a), (b) and (e) and adding paragraph (f)
to read as follows:
52.31 Deployment of Long-Term Database Methods for Number Portability
by CMRS Providers.
(a) By March 31, 2000, all covered CMRS providers must provide a long-term database
method for number portability, including the ability to support roaming, in compliance
with the performance criteria set forth in section 52.23(a) of this chapter, 47 C.F.R.
52.23. A licensee may have more than one CMRS system, but only the systems that
satisfy the definition of covered CMRS are required to provide number portability.
(b) By December 31, 1998, all covered CMRS providers must have the capability to
obtain routing information, *****
*****
(e) The Chief, Wireless Telecommunications Bureau, may establish reporting
requirements in order to monitor the progress of covered CMRS providers implementing
number portability, ***** APPENDIX C
SECOND SUPPLEMENTAL FINAL REGULATORY FLEXIBILITY ANALYSIS
1. As required by the Regulatory Flexibility Act (RFA), an Initial Regulatory
Flexibility Analysis (IRFA) was incorporated into the Notice of Proposed Rulemaking in this
docket (Notice). The Commission sought written public comment on the proposals in the
Notice, including comment on the IRFA. The comments received on the IRFA were discussed in
the First Report and Order's Final Regulatory Flexibility Analysis (FRFA-First Report and
Order), which was incorporated as Appendix C to the First Report and Order in this docket.
The FRFA-First Report and Order conforms to the RFA. On reconsideration of the First Report
and Order, parties commented on the FRFA-First Report and Order. The comments received on
the FRFA-First Report and Order were discussed in the Supplemental Final Regulatory Flexibility
Analysis (Supplemental FRFA) incorporated into the First Order on Reconsideration in this
docket. The Supplemental FRFA conforms to the RFA. This Second Supplemental Final
Regulatory Flexibility Analysis (Second Supplemental FRFA) is incorporated as an appendix to
the Second Order on Reconsideration in this docket. This Second Supplemental FRFA also
conforms to the RFA.
A. Need for and Objectives of Second Order on Reconsideration
2. The need for and objectives of the requirements adopted in this Second Order on
Reconsideration are the same as those discussed in the Final Regulatory Flexibility Analysis in the
First Report and Order. The Commission, in compliance with sections 251(b)(2) and 251(d)(1)
of the Communications Act of 1934, as amended by the Telecommunications Act of 1996 (the
Act), adopts requirements and procedures intended to ensure the prompt implementation of
telephone number portability with the minimum regulatory and administrative burden on
telecommunications carriers. These requirements are necessary to implement the provision in the
Act requiring local exchange carriers (LECs) to offer number portability, if technically feasible. In
implementing the statute, the Commission has the responsibility to adopt requirements that will
implement most quickly and effectively the national telecommunications policy embodied in the
Act and to promote the pro-competitive, deregulatory markets envisioned by Congress. Congress
has recognized that number portability will lower barriers to entry and promote competition in the
local exchange marketplace.
B. Summary of Significant Issues Raised By Public Comments in response to
the IRFA, FRFA-First Report and Order, and Supplemental FRFA
3. The comments received on the IRFA were discussed in the FRFA-First Report and
Order incorporated into the First Report and Order. The comments received on the FRFA-First
Report and Order were discussed in the Supplemental FRFA incorporated into the First Order on
Reconsideration. No additional comments were sought or received for purposes of this Second
Supplemental FRFA.
C. Summary of the FRFA-First Report and Order
4. In the FRFA-First Report and Order, we concluded that incumbent LECs do not
qualify as small businesses because they are dominant in their field of operation, and, accordingly,
we did not address the impact of the Commission's requirements on incumbent LECs. We noted
that the RFA generally defines the term "small business" as having the same meaning as the term
"small business concern" under the Small Business Act. A small business concern is one that (1)
is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies
any additional criteria established by the Small Business Administration (SBA). According to
the SBA's regulations, entities engaged in the provision of telephone service may have a maximum
of 1,500 employees in order to qualify as a small business concern. This standard also applies in
determining whether an entity is a small business for purposes of the Regulatory Flexibility Act.
5. We did recognize that the Commission's requirements may have a significant
economic impact on a substantial number of small businesses insofar as they apply to
telecommunications carriers other than incumbent LECs, including competitive LECs, as well as
cellular, broadband personal communications services (PCS), and covered specialized mobile
radio (SMR) providers. Based upon data contained in the most recent census and a report by the
Commission's Common Carrier Bureau, we estimated that 2,100 carriers could be affected. We
also discussed the reporting requirements imposed by the First Report and Order.
6. Finally, we discussed the steps we had taken to minimize the impact on small
entities, consistent with the Commission's stated objectives. We concluded that our actions in
the First Report and Order would benefit small entities by facilitating their entry into the local
exchange market. We found that the record in this proceeding indicated that the lack of number
portability would deter entry by competitive providers of local service because of the value
customers place on retaining their telephone numbers. These competitive providers, many of
which may be small entities, may find it easier to enter the market as a result of number
portability, which will eliminate this barrier to entry. We noted that, in general, we attempted to
keep burdens on local exchange carriers to a minimum. For example, we adopted a phased
deployment schedule for implementation in the 100 largest MSAs, and then elsewhere upon a
carrier's request; we conditioned the provision of currently available measures upon request only;
we did not require cellular, broadband PCS, and covered SMR providers, which may be small
businesses, to offer currently available number portability measures; and we did not require paging
and messaging service providers, which may be small entities, to provide any number portability.
D. Summary of the Supplemental FRFA
7. Implementation Schedule. In the First Report and Order, we required local
exchange carriers operating in the 100 largest MSAs to offer long-term service provider
portability, according to a phased deployment schedule commencing on October 1, 1997, and
concluding by December 31, 1998, set forth in Appendix F of the First Report and Order. In
the First Order on Reconsideration, we extended the end dates for Phase I of our deployment
schedule by three months, and for Phase II by 45 days. Thus, deployment will now take place in
Phase I from October 1, 1997, through March 31, 1998, and in Phase II from January 1, 1998,
through May 15, 1998. We also clarified that LECs need only provide number portability within
the 100 largest MSAs in switches for which another carrier has made a specific request for the
provision of portability. LECs must make available lists of their switches for which deployment
has and has not been requested. The parties involved in such requests identifying preferred
switches may need to use legal, accounting, economic and/or engineering services.
8. In the First Order on Reconsideration, we reduced the burdens on rural and
smaller LECs by establishing a procedure whereby, within as well as outside the 100 largest
MSAs, portability need only be implemented in the switches for which another carrier has made a
specific request for the provision of portability. If competition is not imminent in the areas
covered by rural/small LEC switches, then the rural or smaller LEC should not receive requests
from competing carriers to implement portability, and thus need not expend its resources until
competition does develop. By that time, extensive non-carrier-specific testing will likely have
been done, and rural and small LECs need not expend their resources on such testing. We noted
that the majority of parties representing small or rural LECs seeking relief asked that we only
impose implementation requirements where competing carriers have shown interest in portability.
Moreover, our extension of Phases I and II of our deployment schedule may permit smaller LECs
to reduce their testing costs by allowing time for larger LECs to test and resolve the problems of
this new technology.
9. In the First Order on Reconsideration, we rejected several alternatives put forth
by parties that might impose greater burdens on small entities and small incumbent LECs. We
rejected requests to accelerate the deployment schedule for areas both within and outside the 100
largest MSAs. We also rejected the procedures proposed by some parties that would require
LECs to file waiver requests for their specific switches if they believe there is no competitive
interest in those switches, instead of requiring LECs to identify in which switches of other LECs
they wish portability capabilities. The suggested waiver procedures would burden the LEC from
whom portability is requested with preparing and filing the petition for waiver. In addition, a
competing carrier that opposes the waiver petition would be burdened with challenging the
waiver. In contrast, under the procedure we establish, the only reporting burden on requesting
carriers is to identify and request their preferred switches. Carriers from which portability is being
requested, which may be small incumbent LECs, only incur a reporting burden if they wish to
lessen their burdens further by requesting more time in which to deploy portability. Finally, we
clarified that CMRS providers, like wireline providers, need only provide portability in requested
switches, both within and outside the 100 largest MSAs.
E. Description and Estimates of the Number of Small Entities Affected by this
Second Order on Reconsideration
10. Consistent with our prior practice, we shall continue to exclude small incumbent
LECs from the definition of a small entity for the purpose of this Second Supplemental FRFA.
Accordingly, our use of the terms "small entities" and "small businesses" does not encompass
"small incumbent LECs." Nevertheless, we include small incumbent LECs in our Second
Supplemental FRFA. We use the term "small incumbent LECs" to refer to any incumbent LECs
that arguably might be defined by SBA as "small business concerns."
11. Total Number of Telephone Companies Affected. Many of the decisions and rules
adopted herein may have a significant effect on a substantial number of the small telephone
companies identified by SBA. The United States Bureau of the Census ("the Census Bureau")
reports that, at the end of 1992, there were 3,497 firms engaged in providing telephone services,
as defined therein, for at least one year. This number contains a variety of different categories of
carriers, including local exchange carriers, interexchange carriers, competitive access providers,
cellular carriers, mobile service carriers, operator service providers, pay telephone operators, PCS
providers, covered SMR providers, and resellers. It seems certain that some of those 3,497
telephone service firms may not qualify as small entities or small incumbent LECs because they
are not "independently owned and operated." For example, a PCS provider that is affiliated with
an interexchange carrier having more than 1,500 employees would not meet the definition of a
small business. It seems reasonable to conclude, therefore, that fewer than 3,497 telephone
service firms are small entity telephone service firms or small incumbent LECs that may be
affected by this Order on Reconsideration.
12. Wireline Carriers and Service Providers. SBA has developed a definition of small
entities for telephone communications companies other than radiotelephone (wireless) companies.
The Census Bureau reports that, there were 2,321 such telephone companies in operation for at
least one year at the end of 1992. According to SBA's definition, a small business telephone
company other than a radiotelephone company is one employing fewer than 1,500 persons. All
but 26 of the 2,321 non-radiotelephone companies listed by the Census Bureau were reported to
have fewer than 1,000 employees. Thus, even if all 26 of those companies had more than 1,500
employees, there would still be 2,295 non-radiotelephone companies that might qualify as small
entities or small incumbent LECs. Although it seems certain that some of these carriers are not
independently owned and operated, we are unable at this time to estimate with greater precision
the number of wireline carriers and service providers that would qualify as small business
concerns under SBA's definition. Consequently, we estimate that there are fewer than 2,295 small
entity telephone communications companies other than radiotelephone companies that may be
affected by the decisions and rules adopted in this Order on Reconsideration.
13. Local Exchange Carriers. Neither the Commission nor SBA has developed a
definition of small providers of local exchange services (LECs). The closest applicable definition
under SBA rules is for telephone communications companies other than radiotelephone (wireless)
companies. The most reliable source of information regarding the number of LECs nationwide of
which we are aware appears to be the data that we collect annually in connection with the
Telecommunications Relay Service (TRS) Worksheet. According to our most recent data, 1,347
companies reported that they were engaged in the provision of local exchange services.
Although it seems certain that some of these carriers are not independently owned and operated,
or have more than 1,500 employees, we are unable at this time to estimate with greater precision
the number of LECs that would qualify as small business concerns under SBA's definition.
Consequently, we estimate that there are fewer than 1,347 small incumbent LECs that may be
affected by the decisions and rules adopted in this Order on Reconsideration.
14. Interexchange Carriers. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to providers of interexchange services (IXCs).
The closest applicable definition under SBA rules is for telephone communications companies
other than radiotelephone (wireless) companies. The most reliable source of information
regarding the number of IXCs nationwide of which we are aware appears to be the data that we
collect annually in connection with the TRS Worksheet. According to our most recent data, 130
companies reported that they were engaged in the provision of interexchange services.
Although it seems certain that some of these carriers are not independently owned and operated,
or have more than 1,500 employees, we are unable at this time to estimate with greater precision
the number of IXCs that would qualify as small business concerns under SBA's definition.
Consequently, we estimate that there are fewer than 130 small entity IXCs that may be affected by
the decisions and rules adopted in this Order on Reconsideration.
15. Competitive Access Providers. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to providers of competitive access services
(CAPs). The closest applicable definition under SBA rules is for telephone communications
companies other than radiotelephone (wireless) companies. The most reliable source of
information regarding the number of CAPs nationwide of which we are aware appears to be the
data that we collect annually in connection with the TRS Worksheet. According to our most
recent data, 57 companies reported that they were engaged in the provision of competitive access
services. Although it seems certain that some of these carriers are not independently owned and
operated, or have more than 1,500 employees, we are unable at this time to estimate with greater
precision the number of CAPs that would qualify as small business concerns under SBA's
definition. Consequently, we estimate that there are fewer than 57 small entity CAPs that may be
affected by the decisions and rules adopted in this Order on Reconsideration.
16. Operator Service Providers. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to providers of operator services. The closest
applicable definition under SBA rules is for telephone communications companies other than
radiotelephone (wireless) companies. The most reliable source of information regarding the
number of operator service providers nationwide of which we are aware appears to be the data
that we collect annually in connection with the TRS Worksheet. According to our most recent
data, 25 companies reported that they were engaged in the provision of operator services.
Although it seems certain that some of these companies are not independently owned and
operated, or have more than 1,500 employees, we are unable at this time to estimate with greater
precision the number of operator service providers that would qualify as small business concerns
under SBA's definition. Consequently, we estimate that there are fewer than 25 small entity
operator service providers that may be affected by the decisions and rules adopted in this Order
on Reconsideration.
17. Pay Telephone Operators. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to pay telephone operators. The closest
applicable definition under SBA rules is for telephone communications companies other than
radiotelephone (wireless) companies. The most reliable source of information regarding the
number of pay telephone operators nationwide of which we are aware appears to be the data that
we collect annually in connection with the TRS Worksheet. According to our most recent data,
271 companies reported that they were engaged in the provision of pay telephone services.
Although it seems certain that some of these carriers are not independently owned and operated,
or have more than 1,500 employees, we are unable at this time to estimate with greater precision
the number of pay telephone operators that would qualify as small business concerns under SBA's
definition. Consequently, we estimate that there are fewer than 271 small entity pay telephone
operators that may be affected by the decisions and rules adopted in this Order on
Reconsideration.
18. Wireless (Radiotelephone) Carriers. SBA has developed a definition of small
entities for radiotelephone (wireless) companies. The Census Bureau reports that there were
1,176 such companies in operation for at least one year at the end of 1992. According to SBA's
definition, a small business radiotelephone company is one employing fewer than 1,500 persons.
The Census Bureau also reported that 1,164 of those radiotelephone companies had fewer than
1,000 employees. Thus, even if all of the remaining 12 companies had more than 1,500
employees, there would still be 1,164 radiotelephone companies that might qualify as small
entities if they are independently owned are operated. Although it seems certain that some of
these carriers are not independently owned and operated, we are unable at this time to estimate
with greater precision the number of radiotelephone carriers and service providers that would
qualify as small business concerns under SBA's definition. Consequently, we estimate that there
are fewer than 1,164 small entity radiotelephone companies that may be affected by the decisions
and rules adopted in this Order on Reconsideration.
19. Cellular Service Carriers. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to providers of cellular services. The closest
applicable definition under SBA rules is for radiotelephone (wireless) companies. The most
reliable source of information regarding the number of cellular service carriers nationwide of
which we are aware appears to be the data that we collect annually in connection with the TRS
Worksheet. According to our most recent data, 792 companies reported that they were engaged
in the provision of cellular services. Although it seems certain that some of these carriers are
not independently owned and operated, or have more than 1,500 employees, we are unable at this
time to estimate with greater precision the number of cellular service carriers that would qualify as
small business concerns under SBA's definition. Consequently, we estimate that there are fewer
than 792 small entity cellular service carriers that may be affected by the decisions and rules
adopted in this Order on Reconsideration.
20. Mobile Service Carriers. Neither the Commission nor SBA has developed a
definition of small entities specifically applicable to mobile service carriers, such as paging
companies. The closest applicable definition under SBA rules is for radiotelephone (wireless)
companies. The most reliable source of information regarding the number of mobile service
carriers nationwide of which we are aware appears to be the data that we collect annually in
connection with the TRS Worksheet. According to our most recent data, 138 companies reported
that they were engaged in the provision of mobile services. Although it seems certain that some
of these carriers are not independently owned and operated, or have more than 1,500 employees,
we are unable at this time to estimate with greater precision the number of mobile service carriers
that would qualify under SBA's definition. Consequently, we estimate that there are fewer than
138 small entity mobile service carriers that may be affected by the decisions and rules adopted in
this Order on Reconsideration.
21. Broadband Personal Communications Service (PCS). The broadband PCS
spectrum is divided into six frequency blocks designated A through F and the Commission has
held auctions for each block. The Commission defined "small entity" for Blocks C and F as an
entity that has average gross revenues of less than $40 million in the three previous calendar
years. For Block F, an additional classification for "very small businesses" was added and is
defined as an entity that, together with their affiliates, has average gross revenues of not more
than $15 million for the preceding three calendar years. These regulations defining "small
entity" in the context of broadband PCS auctions have been approved by the SBA. No small
businesses within the SBA-approved definition bid successfully for licenses in Blocks A and B.
There were 90 winning bidders that qualified as small entities in the Block C auctions. A total of
93 small and very small business bidders won approximately 40% of the 1,479 licenses for Blocks
D, E, and F. However, licenses for blocks C through F have not been awarded fully, therefore
there are few, if any, small businesses currently providing PCS services. Based on this
information, we conclude that the number of small broadband PCS licensees will include the 90
winning C Block bidders and the 93 qualifying bidders in the D, E, and F blocks, for a total of 183
small PCS providers as defined by the SBA and the Commission's auction rules.
22. SMR Licensees. Pursuant to 47 C.F.R. 90.814(b)(1), the Commission has
defined "small entity" in auctions for geographic area 800 MHz and 900 MHz SMR licenses as a
firm that had average annual gross revenues of less than $15 million in the three previous calendar
years. This definition of a "small entity" in the context of 800 MHz and 900 MHz SMR has been
approved by the SBA. The rules adopted in this Order on Reconsideration. may apply to SMR
providers in the 800 MHz and 900 MHz bands that either hold geographic area licenses or have
obtained extended implementation authorizations. We do not know how many firms provide 800
MHz or 900 MHz geographic area SMR service pursuant to extended implementation
authorizations, nor how many of these providers have annual revenues of less than $15 million.
We assume, for purposes of this Supplemental FRFA, that all of the extended implementation
authorizations may be held by small entities, which may be affected by the decisions and rules
adopted in this Order on Reconsideration.
23. The Commission recently held auctions for geographic area licenses in the 900
MHz SMR band. There were 60 winning bidders who qualified as small entities in the 900 MHz
auction. Based on this information, we conclude that the number of geographic area SMR
licensees affected by the rule adopted in this Order on Reconsideration includes these 60 small
entities. No auctions have been held for 800 MHz geographic area SMR licenses. Therefore, no
small entities currently hold these licenses. A total of 525 licenses will be awarded for the upper
200 channels in the 800 MHz geographic area SMR auction. However, the Commission has not
yet determined how many licenses will be awarded for the lower 230 channels in the 800 MHz
geographic area SMR auction. There is no basis, moreover, on which to estimate how many
small entities will win these licenses. Given that nearly all radiotelephone companies have fewer
than 1,000 employees and that no reliable estimate of the number of prospective 800 MHz
licensees can be made, we assume, for purposes of this FRFA, that all of the licenses may be
awarded to small entities who, thus, may be affected by the decisions in this Order on
Reconsideration.
24. Resellers. Neither the Commission nor SBA has developed a definition of small
entities specifically applicable to resellers. The closest applicable definition under SBA rules is for
all telephone communications companies. The most reliable source of information regarding the
number of resellers nationwide of which we are aware appears to be the data that we collect
annually in connection with the TRS Worksheet. According to our most recent data, 260
companies reported that they were engaged in the resale of telephone services. Although it
seems certain that some of these carriers are not independently owned and operated, or have more
than 1,500 employees, we are unable at this time to estimate with greater precision the number of
resellers that would qualify as small business concerns under SBA's definition. Consequently, we
estimate that there are fewer than 260 small entity resellers that may be affected by the decisions
and rules adopted in this Second Order on Reconsideration.
F. Description of Projected Reporting, Recordkeeping and Other Compliance
Requirements
25. There are no significant reporting, recordkeeping or other compliance
requirements imposed on small entities by this Second Order on Reconsideration on other
entities.
G. Steps Taken to Minimize Significant Economic Impact on Small Entities and
Significant Alternatives Considered
26. The Commission's actions in this Second Order on Reconsideration will benefit
small entities by facilitating their entry into the local exchange market. The record in this
proceeding indicates that the lack of number portability would deter entry by competitive
providers of local service because of the value customers place on retaining their telephone
numbers. These competitive providers, many of which may be small entities, may find it easier
to enter the market as a result of number portability which will eliminate this barrier to entry.
27. In general in this docket, we have attempted to keep burdens on local exchange
carriers to a minimum. The regulatory burdens we have imposed are necessary to ensure that the
public receives the benefit of the expeditious provision of service provider number portability in
accordance with the statutory requirements. We believe that the Second Order on
Reconsideration furthers our commitment to minimizing regulatory burdens on small entities.
Based on the record before us, we do not find that any of the recommendations we adopt in the
Second Order on Reconsideration will have a disproportionate impact on small entities.
28. Report to Congress: The Commission will send a copy of the Second Order on
Reconsideration, including the Second Supplemental FRFA, in a report to be sent to Congress
pursuant to the Small Business Regulatory Fairness Act of 1996. A copy of the Second Order
on Reconsideration and this Second Supplemental FRFA (or summary thereof) will also be
published in the Federal Register and will be sent to the Chief Counsel for Advocacy of the Small
Business Administration.